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Africa Can Teach You a Good Lesson About Mobile Money

While a majority of Western users have a bank card, in Africa most don’t. At the same time, Mobile phone ownership across the continent is growing the quickest. As a result, many consumers need to rely on digital alternatives instead of traditional payment methods such as cash and bank cards.

Sub-Saharan Africa is a great example in expanding worldwide financial inclusion. Of the top 20 countries in the world for Mobile Money usage, 15 are in Africa. This is according to a survey conducted by the Gates Foundation, the World Bank and Gallup World Poll.

The growth of mobile Money systems across the region is skyrocketing. In 2002, only 3 percent of people in the entire continent had mobile phones. By 2010 that number had increased to 48 percent. Last year, nearly 80 percent of the continent’s population had a mobile phone and the number is still climbing.

Mobile devices offer their owners an access to goods and services without the need for cash, credit cards, or even a checking or savings account. This practically sets unlimited potential for growth before the African markets. As the World Bank’s Global Findex database reveals, in Sub-Saharan Africa 12 percent of adults have mobile money accounts, compared to just 2 percent worldwide. This shows how well mobile-payment platforms have answered the growing needs of mobile phone users, as well as those of the operator companies.

Thanks to mobile payments, profits have increased dramatically for mobile network operators. In Kenya alone, mobile money transactions totaled $27 billion in 2015, which comes to $3 million per hour. Tanzania, Uganda, Senegal and Ghana are not far behind.

‘M-Pesa phenomenon’ in Kenya

For several years, the buzz surrounding mobile-based financial services has been focused almost exclusively on East Africa, particularly Kenya. It is considered home to the world’s highest mobile money account ownership rates. The huge growth in Kenya saw a take-up by 9 million customers in the first four years after the idea was conceived in 2007. Nearly a decade after its launch, M-Pesa has transformed economic interaction in Kenya. Its success reshaped country’s banking and telecom sectors, extended financial inclusion for nearly 20 million Kenyans. Furthermore, it facilitated the creation of thousands of small businesses.

What Kenya has proven is that the solution to mainstream mobile banking might not be fancy smartphones, apps or high-speed internet connection. All that M-Pesa mobile money system requires is a basic SMS-enabled phone. Everything from how to sign up, to fees and rates, is super easy to understand. Users can also send money to any mobile device, even if the other user is not subscribed to the service.

Lessons for expanding financial access

By taking advantage of new technologies, and offering products that are cheaper and more convenient than cash, Sub-Saharan Africa presents the world with lessons for expanding financial access. Mobile money has become a major economic driver for the region. Its technology make it possible for even the most isolated and underprivileged citizens to engage in commercial activity.

Mobile money is bringing new customers to more businesses than ever before because the system is simple, fast and doesn’t require much of an investment. Moreover, mobile money platforms cut down on corruption by enabling users to transfer money to each other and make payments directly to businesses and service providers. Thus reducing the need to operate in a cash-only economy.

As a result, mobile money technology empowers individuals and supports entrepreneurial creativity in a less constrained financial marketplace. All that makes Africa a prime example of creating a value-added service for users. It eventually has become the means by which they participate in and grow their economy.

Want to know more about mobile money potential beyond Africa? Get in touch with us at Siru Mobile.

The post Africa Can Teach You a Good Lesson About Mobile Money appeared first on Sirumobile.

This post first appeared on Siru Mobile, please read the originial post: here

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Africa Can Teach You a Good Lesson About Mobile Money


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